fat prophets

May make you guys feel better that the FAT boys are fuming with directors as well. ASIC need to roll some heads here!

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Mid-Week Alert - View Resources (VRE)

View Resources has announced today that it has voluntarily appointed administrators to the company, being Darren Weaver and Andrew Saker of firm Ferrier Hodgson.

We spoke with the administrators this afternoon but at this stage they are making no official comment. They did say that they are working with View's management and board on refinancing options for the company and hope to make an announcement within the next few days.

All of this follows our most recent coverage of the company in this week's Mining report where we highlighted the company's disappointing January production month at its Bronzewing gold mine in Western Australia.

Today's news is both disappointing and concerning from Fat Prophets' perspective.

The basis of our most recent analysis was the company's December 2007 quarter production report that was released just 14 days ago (on January 25). In it, the View board commented that operationally things had improved significantly during the December quarter, primarily due to strong production during the month of December.

With respect to our company outlook, we reiterated the caveat that the company had to demonstrate SUSTAINED improvement with respect to its Bronzewing operations in order to regain market credibility, but that the company seemed well on track to achieving this.

View commented on January 25 in its quarterly report that gold production during the month of January would fall below its 10,000 ounce target, but that was not of major concern as overall March quarter production would still be in line with forecasts (i.e. 30,000 ounces for the quarter).

Yet just 12 days later on Wednesday of this week (February 6), View announced that gold production had in fact fallen SUBSTANTIALLY below par (6,500 ounces instead of the budgeted 10,000 ounces) for the month of January.

We assume that on the date of the December quarterly's release (January 25, less than a week before the month's end) that View must have had some idea of the looming production shortfall for the month of January, but instead gave no indication.

This is most concerning to us, as we can only base our analysis for Members on the quality and accuracy of the information provided by the company, not only to us but the market as a whole.

We will await developments and report them as they happen, but to say that we are disappointed at this stage is to put things mildly. In reality, we are incensed with proceedings as they have transpired.

We await further comment from the company and administrators with great interest.